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Ottawa willing to compromise on job grant program after opposition from provinces, businesses

In a renewed effort to show “flexibility” and reach out to the provinces on the Canada Job Grant program, the federal minister responsible, Jason Kenney, has written to the provinces with an olive branch.

OTTAWA—The federal government is prepared to make concessions to implement its promised Canada Job Grant program after a show of united opposition from provinces and business leaders, sources say.

A renewed effort to show “flexibility” and reach out to the provinces is underway to rescue the much-criticized measure, with the federal minister responsible for the Conservatives’ showpiece program, Jason Kenney, writing to the provinces with an olive branch.

That could mean allowing provinces to keep more of the skills training money they now receive, reducing the contribution expected from small business employers, or a combination of moves that might bring some or all of the provinces onside.

A big push is on to negotiate with provincial ministers responsible for skills training and labour markets prior to a federal/provincial meeting that a source confirmed would be held in Toronto on Nov. 8.

“We’re exploring flexibility with the program to make it work better for the provinces. There will be a lot of focus and negotiations on these flexibilities in the lead-up to the 8th,” said the source on background.

Meanwhile, in a separate letter to the Building Trades Council, Kenney said the government recognizes a “one-size-fits-all” approach will not work.

It suggests there is a lot of “misunderstanding” around the program, which Ottawa insists has built-in flexibility.

Kenney says the government will not require employers to pay $5,000 per worker, “only that the employer cost-match a portion of the training cost, for which Ottawa will kick in up to a maximum of $5,000.”

“As the employer will determine which type of training is necessary, in many cases the employer portion of the training may be significantly less than $5,000,” Kenney wrote.

Ottawa is also promising to reduce the program’s paperwork, so that employers need only deal with one level of government when applying for the grant, not two.

However, if no middle ground with the provinces can be found, Kenney said publicly last week that Ottawa may go it alone and deliver a federal jobs grant.

Ontario’s minister responsible for training programs, Brad Duguid, confirmed he has heard a different tone coming from Kenney, the federal Employment and Social Development Minister who took over the program first announced in this spring’s federal budget.

Duguid spoke to Kenney for the first time the week before last prior to a meeting of his provincial counterparts.

“The indication was they were willing to look at some changes and flexibility,” said Duguid in an interview. “We see that as a positive, but there’s a long way to go to do two things: make this program work and to find a funding source for this program so it’s not funded on the backs of our most vulnerable workers.”

Under the Labour Market Agreement with provinces, Ottawa currently transfers $500 million a year to provinces for skills training programs. The budget announced a plan to take 60 per cent of that, $300 million, and put it toward efforts to better match workers to job vacancies by providing necessary skills training.

The Conservatives want the program to provide individual job grants of up to $15,000 to be split three ways — 5,000 each from Ottawa, the province and an employer — a proposal that was sprung on the provinces that led to big objections..

Duguid says it is “irresponsible” of the federal government to demand Ontario strip its current skill training programs of about $116 million and spend $116 million on this program — for what he says is a total of $232 million — which would divert money away from “our most vulnerable” individuals: “aboriginal people, newcomers, people with literacy challenges, or youth at risk,” says Duguid.

“That’s going to do a lot of social damage, but it’s also really dumb economics,” he said.

Kenney’s letter to the building trades council says the job grant already provides many options:

Workers need only the backing of an employer to apply for a skills training grant under the program; training may be offered not just through universities or colleges, but also trade union centres, vocational colleges and other provincially certified trainers; and may be on-site workplace training or off-site, as long as a recognized third-party trainer provides the training. Individual employers, groups of employers and industry associations can apply for grants. And employers may “pool” potential employees — train them up for when jobs become available — or be used to support apprenticeship training.

Kenney told CTV last week: “We hope we can work out a flexible arrangement with the provinces, but if not, we’re going to go ahead ourselves and administer directly a federal jobs grant.”

Kenney said a lot of the money now transferred to the provinces under the Labour Market Agreement goes to “training for the sake of training” and the government wants to put more money directly into job creation, and spur businesses to “get some skin in the game.”

“But if they just want the federal government to write them a blank cheque for training that we do not think is leading to job creation and they don’t want to participate, then plan B would be for us to deliver a program directly from the federal government.”

Duguid said he was “offended” by “unethical” references to provincial spending as “training for the sake of training”— as Kenney did. He said Ontario’s position is that 87 per cent of those who come out of the programs the province now funds emerge with “some form of employment.”

“To suggest those programs don’t lead to employment is absolutely wrong.”

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